The current trading session witnessed a notable surge in the shares of Graphite Bio, Inc. (NASDAQ: GRPH), with an impressive increase of 15.92% to reach $3.64. This surge in stock value ensued the announcement of a special dividend linked to a merger agreement.
Graphite Bio (GRPH) formally declared the allocation of a special dividend by its Board of Directors in connection with the previously disclosed merger with Lenz Therapeutics, as per the Agreement and Plan of Merger dated November 14, 2023. The projected amount of the special dividend, estimated at $1.03 per share of common stock, will be disbursed in cash to shareholders recorded as of March 18, 2024.
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The precise sum of the special dividend will be determined after deductions as specified in the Merger Agreement, with the payment scheduled for March 21, 2024. However, it is notable that the special dividend will not surpass $60 million, subject to alterations outlined in the Merger Agreement.
The distribution of the special dividend hinges on the successful closure of the Merger, which GRPH shareholders will deliberate upon and vote on during the special meeting scheduled for 9:00 a.m. PT on March 14, 2024. The closure is anticipated post-market on March 21, 2024, contingent upon approval from Graphite’s shareholders and fulfillment or waiver of all conditions outlined in the Merger Agreement.
Graphite Bio previously entered into a definitive merger agreement with LENZ to merge the entities in an all-stock transaction. The primary initiatives of the combined entity will address presbyopia, the age-related decline in near vision affecting a substantial portion of the population aged 45 and above. Following the merger, the combined entity is anticipated to be listed on Nasdaq under the symbol “LENZ.”
Moreover, in tandem with the merger, Graphite Bio has secured a subscription agreement for a PIPE financing worth $53.5 million, expected to conclude concurrently with the merger, involving a consortium of healthcare investors led by LENZ’s existing backers, alongside participation from new investors.